The leading global manufacturer of graphics and AI processors is anticipating fourth-quarter revenue to surpass market expectations, driven by surging demand in artificial intelligence and the metaverse sectors.
Nvidia Corp announced on Wednesday that it expects Q4 revenue of $7.40 billion, give or take 2%, exceeding analysts’ average forecast of $6.86 billion, based on Refinitiv’s IBES data. This optimistic outlook is supported by a sharp rise in its data centre operations, which are seeing increased investments from internet companies focused on AI and metaverse development.
Following the announcement, Nvidia’s shares climbed nearly 4% in after-hours trading. The stock has already more than doubled over the course of the year.
The COVID-19 pandemic accelerated demand for Nvidia’s graphic chips, particularly for gaming systems and PCs, as homebound consumers turned to video games. Additionally, the crypto mining sector provided a significant boost. Nvidia is also reaping the benefits of its investments in AI hardware for data centres and self-driving car technologies.
In the recently concluded third quarter, Nvidia’s gaming division posted a 42% increase in revenue, reaching $3.22 billion, while its data centre revenue jumped 55% to $2.94 billion. These results surpassed analyst predictions, which were $3.13 billion for gaming and $2.75 billion for data centres, according to FactSet.
Overall, Nvidia’s total Q3 revenue rose approximately 50% to $7.10 billion for the quarter ending October 31, topping the $6.83 billion average estimate from Refinitiv IBES.
